Investment in setting up trading company in Vietnam is
considered as investment in conditional investment areas

Once an underdeveloped
country, in the last two decades Vietnam has shown an incredible growth in the
world economic scene, especially in the criteria of investment attraction. For
a foreign company that is interested in expanding the business in a new country
or region, Vietnam is a promising destination. In order to start a company or
specifically a trading company in Vietnam, foreign investor should
comprehensively understand the formality and function of the legal entity to be
formed according to Vietnam Law. The consultancy and guidance of skilled and
qualified lawyers in Vietnam law firm throughout the process
shall mostly be needed.

The legal basis for a
foreign company to set up a company in Vietnam is
stated in the Enterprise Law of Vietnam: foreign organizations and
individuals will be entitled to establish and manage enterprises in Vietnam in
accordance with this law, with some exceptions. Foreign investors may
invest in the form of 100% foreign- owned capital to establish limited liability companies,
joint-stock companies, partnerships or private enterprises under the provisions
of the Enterprise Law and relevant laws.

The foreign investor
shall mostly needs to fulfill the investment registration procedures at
provincial-level state agencies in charge of investment in order to be granted
the investment certificates, in accordance with Vietnam law in investment.
The dossier required for the investment registration shall comprise of
an examination dossier, papers showing the capability to satisfy the
conditions which the project is required by law to satisfy, for investment
projects in conditional investment domains i.e. specific goods to be traded at
HS code level, experience in trading area, how the trading procedures would be
carried out, potential business in Vietnam.

In particular, for
investment capital, it should be noted that, trading company needs to
commit larger investment in terms of capital, since its function is to identify
competitive suppliers, negotiate and purchase their products and sell them
through a distribution network in Vietnam. In the meantime, the investor needs
to have experience in trading to run the business smoothly and efficiently. The
investor should explain why the company would contribute to the
development in Vietnam when applying for investment license at Department of
Planning and Investment, and Ministry of Trade and Commerce.

Our lawyers of foreign
investment practice at ANT Lawyers are available to advise and provide client
with service and representation in Vietnam.